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Money Laundering Prevention: Deterring, Detecting, and Resolving Financial Fraud by Jonathan E. Turner

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Chapter 6

Discovery and Prevention

Early Warning Is Essential to AML

Anti-money-laundering (AML) professionals have long known that it is not enough to respond to events. Playing fireman means that you are finding fires after the house is ablaze. Adding value requires that AML programs, like real fire-prevention programs, find ways to stop fires before they begin and take active steps to identify high-risk areas to mitigate the risks.

Fortunately, today's enhanced compliance and regulatory environment encourages this type of a proactive approach. If AML programs can seek out indications of improper activity at the smallest level possible, money launderers and terror financiers will have to find a different kind of organization to move the money through. The question is how to make that happen. Effective internal controls, a well-publicized compliance and reporting process, and a culture of honesty aid in the process. The reality, however, is that every organization has employees and customers who are dishonest.

Identifying the dishonest people, if it were possible, would be a great solution. However, until society has a means to accomplish that, AML professionals must focus on finding the areas where dishonest people set up money laundering schemes and remove those opportunities. Much like the firemen above, the goal is to not just fight the fires but to find places that are susceptible to fire and stop those fires before they start.

In keeping with evolving laws and regulations, ...

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